The Blackstone Real Estate Income Trust, one of the world’s largest property investment funds, in April accepted 29 per cent of 4.5 billion dollars worth in redemption requests. The fund told investors on Monday that it decided to fulfil 1.3 billion, less than a third, of these requests to sell.
The 70 billion dollar fund is known as BREIT and is seen as a bellwether among global real estate investment funds. In a letter to investors dated 1 May, it said that the April volume of redemption requests was similar to March and was 15 percent lower than the peak in January.
Blackstone said that its BREIT fund now has paid back a total of 6.2 billion dollars to investors since November 2022, when investors started reducing their holdings amid concern that rising interest rates would harm property prices.
Blackstone’s BREIT fund is a US-domiciled unlisted real estate investment fund offered to US and non-US investors, held both by institutional and retail investors.
The fund, created in 2017, has become one of the largest US property funds in less than five years, buying apartments, suburban homes, dorms, data centres, hotels and shopping centres across the US. It owns the Bellagio hotel and casino in Las Vegas; a 76-story New York skyscraper designed by Frank Gehry; and a sprawling Florida complex for trainees working at the Walt Disney World Resort.
In Luxembourg, the New York-based firm runs a 34-staff fund business. It is licenced here as an Alternative Investment Fund Manager. Several dozen of its US-based funds are made available internationally via structured feeder vehicles domiciled in Luxembourg.
Luxembourg is regarded as a hub for real estate investment funds in Europe. However, Luxembourg-domiciled funds, unlike their US-based counterparts, only are required to report on their performance annually. US real estate funds are bound by more stringent reporting requirements under rules set by the Securities and Exchange Commission.